Netflix changes subscription prices, further angers its customers

Earlier this year I wrote a piece about changes Netflix made to its website which forced its customers towards the online streaming part of its service and downplayed the DVD-by-mail option. It generated a lot of discussion because the move was alienating some of its customer base who prefer the mail option over streaming due to the lack of a decent selection of online movies.

Netflix wants to eventually stop the mail option altogether, and this week they made more changes to further this strategy. This time it has the potential to anger customers even more because it hits them in the wallet, not just how they navigate the Netflix site. The company is splitting its DVD and streaming plans in two – subscribers who want only DVDs can have a plan without streaming options and vice versa. Those that want both can still have it, but at an increased price.

Customers have been less than happy, to say the least. Netflix’s post announcing the change on Facebook has tens of thousands of comments, most of them angry ones. There’s even a Twitter hashtag, #DearNetflix, which has plenty of not-too-kind tweets in the company’s direction.

Like before, these changes wouldn’t be that big of a deal if customers could stream most of, if not all of Netflix content, but they can’t. I said it before, until Netflix solves this they should not be boosting prices for a half-baked service. Whether the company starts bleeding customers remains to be seen, but from a PR standpoint, it continues to make mistake after mistake this year.

What do you think about Netflix’s pricing changes?

Larry Bills

Larry Bills has a vast archive of entertainment facts and figures stored inside his large-ish head. What was a pointless pursuit to become a pop-culture trivia machine was legitimized by Hoover's when they put him on the media beat. When he's not working as both a blogger and the Managing Editor of Bizmology, Larry is a horror novelist.

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Comments

  1. Adrianne Yule says:

    I had already told my husband we needed to drop down to streaming only simply because we can NEVER get a new release by mail from Netflix. He fought me on it, but forwarded me the email from Netflix yesterday telling us they would essentially be raising our price about $5/month for a limited selection of streaming movies and a bunch of by mail movies, of which we can never get anything we want to see. Umm, no thanks. I had an email from Blockbuster this morning touting a subscription-free by mail option. I don’t think we’ll use the Blockbuster service, but I guess it’s nice to see they aren’t going down without a fight and are trying to take advantage of Netflix’s missteps.

  2. Catherine says:

    I really feel Netflix pushing us to streaming, don’t you? Unfortunately, the way Netflix has its movies set up, right now I need the DVD and unlimited streaming services because Netflix’s portfolio of streaming titles isn’t as robust as I would prefer. I’d love to show my teens movies like Cujo and Christine that scared me at that age, however these movies are only available on the DVD side. Without cable or dish network in our family, Netflix has been a nice option for us for the summer when it’s 100 degrees outside. To keep the Netflix service in our budget, though, it’s likely we’ll have to make a choice — DVD or streaming — come September.

  3. The plan I am currently on — 2 discs plus unlimited streaming — costs $14.99, which comes out to $16.23 total with taxes. The new price for the same plan will come out to $19.98, which will total more than $20. I find more and more that I turn to those 2 DVDs when I really want to be entertained, and I skip over my streaming queue, which mostly sits unwatched unless I’m *really* bored, which is pretty rare. No need to pay $5 for a service I barely use, so I’ll definitely cancel streaming. Thanks Netflix, for giving me a incentive to pay you less while I get to opt out of a service I rarely use. I have a feeling I’m not the only one who feels this way. Not ot a very smart biz plan on their part–I bet their plan to focus on streaming backfires and they actually lose money out of this!

  4. Robert T says:

    I am very dissappointed with this move by Netflix. The selection of “streaming” movies is woeful at best. However, they have a lot of cartoon shows that my children enjoy watching. I really enjoy watching Blu-Rays. The only selection Netflix has that is worth watching…has to come through the mail. So it looks like I am stuck paying the extra $$$ until another provider gets this right. As soon as another provider comes along and offers “all streaming”, I will be gone…and so will Netflixe I suspect!

  5. kathleen cyr says:

    I cancelled my subscription completely. Prices are getting absolutely rediculous.

  6. Netflix can pound sand.

    The naked money grab is just appalling. Netflix saves AT LEAST a buck per rental when a customer streams a selection rather than getting the DVD in the mail. They save postage in both directions and the labor it takes to handle envelopes. I’d bet the savings is even greater. If Netflix was 100% streaming, they could close all those DVD mailing centers and fire 90% of their work force.

    So far, that’s not objectionable for money-making company to do.

    What’s sad is Netflix has dramatically increased the price for a substandard product. The streaming library is as shallow as the kiddie pool in my backyard. One movie in ten is available as streaming.

    Also, my streaming experience is far from optimal. The player often pauses to buffer and the quality isn’t the same. My internet throughput is about 20mbits to any number of speed test servers, so it’s not my DSL!

    Here’s how Netflix loses from my perspective: I will adjust to a DVD-only subscription and dump the substandard streaming service. So Netflix will be sending me more DVDs by mail now. And they dropped the DVD-only option by $4 for 3-out with BD.

    So, bottom line: Netflix will get $4 LESS from me per month and I’ll ramp up by DVD rentals.

    How, exactly, is this good for Netflix?

    Morons.

  7. I think all of you make great points and have a right to be upset. Netflix customer service must be approaching a meltdown today, and deservedly so.

  8. We have been living in the country for 12 years and at our new (in the country) place we can get DSL (we could not before) but the highest priced DSL still is not what Netflix says is really needed. So, no computer at home. And no Netflix streaming for us anyways. I’ll opt out for sure.

  9. I don’t have a problem going to streaming but out of the 400 plus movies in my queue only 128 are available through streaming. They should beef up their instant movies before forcing the switch.
    Next I went online to update my account and they made my change as of 7/17/2011 and not as of September as posted in the email and now I am not able to change back to the $11.00 plan I had. You can’t email a questions and when I called I got a message that they are experiencing high call volume and then it hung up on me.

    How about I just cancel that account Netflix!

  10. Jude Smith says:

    I like the English TV etc on the streaming part. I’m going to have to look for another option. I’m a little tired of having to go on a list to get the latest movies.

  11. I pay more for the blu-ray discs for the picture quality and full digital sound. Streaming does not offer 100% HD quality picture or sound. I might consider looking for alternatives if they make changes for the worse. Additionally, I bought a Sony BD player that can stream Netflix for when I just feel like watching a movie in between receiving discs. It’s alright, but my highlight is still the disc’s. They drop that, I drop the service.

  12. I am going to consider a Roku for a TV we have that’s not hooked up to Wii for our streaming, instead of Netflix. I’ve heard the boxes are about $50. http://www.roku.com/. Eventually, I will see all the movies by disc I need to with my Netflix subscription and our family will just opt for streaming through another service until Netflix stops to realize who pays its bills. Obviously, there is no customer loyalty in the form of a discount for long-term subscribers.

    I know we’re just talking dollars in the monthly increase, but as far as the company’s concerned, its overhead to offer up streaming — and ultimately go 100% streaming without help from the Post Office and its distribution centers — would allow it to shed all of its employees but a skeleton crew and that’s just not cool these days! We’re all trying to keep healthy food on the table, not fill Reed Hastings’ weighty pockets.

  13. Jimbo Jr. says:

    The changes are good for me, ’cause I’m using only DVDs. My plan (2 at a time) will become a couple of bucks cheaper! What’s not to like. Streaming I don’t use at all because, first, I don’t have the hardware for it; second, I don’t care for what they offer via streaming. So all’s good as far as I am concerned. The only thing that makes me a tiny bit apprehensive is not this specific change, but the fact that there’s been a flood of changes lately, which may mean they don’t know what they’re doing and there’ll be more frantic changes not all of them might be as agreeable as this one. But then you know what? The worst thing, I’ll cancel. No big deal.

  14. Somehow, I missed the email stating they were raising the prices, so it was a bit of a shock to me when I saw it. After taxes that raised it $7. I use Netflix because no commercials, so my children are not constantly being fed a steady stream of greed of our culture. And also because I can directly filter what they watch before it comes on. I personally think everything on primetime is a bunch of crap shows anyway. I don’t have cable because of its high prices for only a few channels I would actually watch, so Netflix has been in my home for nearly 5 years. Honestly, streaming is 99.9% of what we do, so canceling the DVD 1 out at a time was not hard. We only use it for the kids cartoons we cannot stream, usually the older stuff I grew up watching, Looney Tunes, etc. Any disc renting, Redbox or local grocery store.

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